We are at the gates of an economic and social crisis that is now inevitable, Covid-19 has completely overturned social and economic habits, the States are getting into debt to cope with the pandemic and the Italian economic engine is almost at a standstill. This situation is unsustainable for both citizens and businesses, and the State could adopt a system to contain it by taxing all Italian people current accounts.
But let us start with the basics. First of all, what is a wealth tax? By this term we mean any type of tax calculated not on income but on the taxpayer’s assets. In Italy, for example, it was applied in ’92, by the Amato Government, which, to avoid the financial crack, imposed a forced withdrawal of six per thousand on the business account and on other types of bank accounts. This category also includes the Local Property Tax, called Ici, or the inheritance tax, while the taxation on financial annuities is not technically a wealth tax.
Considering the complex period we are living through, the hypothesis of the wealth tax has been reproposed. It was suggested by Farinetti, owner of Eataly, who in an interview with the Turin daily La Stampa advises the Government to evaluate this solution to save Italian companies and their accounts, which risk to be overdrawn. “Whoever is in charge,” says Farinetti, “must make an act of courage and impose a wealth tax of 2 per thousand, to have liquidity for companies, to pay wages and save our economic model.
According to Farinetti, if we want to maintain this social model, the government must think very quickly about how to act to help companies, and this tax holds because “those who have more pay more, those who have less will pay less”.
The detractors of this solution could argue that, being applied to “visible” assets, this type of taxation risks hitting the upper middle class, certainly not the great wealthy who can claim their assets in the hands of companies set up abroad or in so-called tax havens. In short, it can be an incentive to accumulate their assets outside national borders and, consequently, further depress investment and deplete the State’s coffers.
Wealth tax or not, it is clear that the 25 billion allocated by the Government, provided by the famous “Decreto Cura Italia”, are not enough and that urgent economic interventions are needed to try to save our economy from Covid-19.
For this reason, more or less feasible proposals are being raised from many quarters, capable of restarting the entire system of the Country. Could a wealth tax be enough to save companies’ business account and the future of the Italian economy? The debate is open.